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Today in the press

Updated / Friday, 9 Feb 2018 09:32

A look at some of today's business stories in the newspapers

FULFIL NUTRITION SHAREHOLDERS IN EXPANSION ROW - A major row has broken out between the shareholders of Fulfil Nutrition, a fast-growing Irish food company backed by Barry Connolly, whose Richmond Marketing is the Irish distributor for Red Bull.

Mr Connolly, who owns 50% of the near €25-million-a-year business, has fallen out with Fulfil’s co-founders, Niall McGrath and Tom Gannon, who each own 25% of the business. Mr McGrath and Mr Gannon confirmed they are taking legal advice in relation to the dispute, says the Irish Times. Fulfil, which sells nutrition snack bars and only launched in 2016, has quickly emerged as a rising star among Irish food brands, and sells to multiples such as Tesco and Supervalu in Ireland, as well as Sainsbury and WH Smith in the UK. It also recently signed a contract with Ryanair, and was a finalist in the Irish Times Innovation Awards in 2017. In its first year of trading, its sales reached about €12 million, before doubling in size last year. The falling-out is over a proposed expansion plan to make Fulfil a major global brand. The shareholders had agreed a plan to rapidly quadruple in size. However, a dispute has emerged over a proposal to scrap that in favour of an even more ambitious, exponentially larger scheme to take it into new continents and market segments.

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PROFITS AT GLEN DIMPLEX ARM HIT €37.8m DESPITE DIP IN REVENUES - Pre-tax profits at a Glen Dimplex group of companies increased by 7% to €37.84m last year in spite of a dip in revenues.

Glen Dimplex is the largest manufacturer of electrical heating worldwide. New accounts for the Dublin-based Glen Dimplex Europe Holdings Ltd show that revenues dipped by 2% from €1 billion to €989.7m in the 12 months to the end of March last. The holding company's revenues are made up of revenues from 29 subsidiaries based here and in Northern Ireland, England, Germany, Austria, Canada, Holland, France, Norway, the United States, New Zealand, Australia, China and India, says the Irish Independent. The directors state that the trading environment in the UK is challenging following the decision of the UK to exit the EU. The group last year paid dividends of €13m and this followed a dividend payout of €8.8m in 2016. The group's balance sheet remains very strong with shareholder funds totalling €436.47m. Accumulated profits stood at €371m. The directors state that the group is in a strong cash position with cash of €302m at the end of March 2017. They said that they will continue to identity areas with further growth potential and acquisitions which would increase shareholder value. Numbers employed by the group last year decreased slightly, going from 5,260 to 5,246, with staff costs falling from €264m to €258m.

***FOCUS OF REPOSSESSION STUDY QUESTIONED BY FLAC - The Central Bank has published research which shows distressed mortgage borrowers were more likely to default on their home loans following a court judgement over six and a half years ago.

According to the research, default rates increased after the ruling, known as the Dunne judgment, when lenders were "effectively banned" from taking back properties from their customers. It found "that borrowers did, in fact, default more than they otherwise would have, if the repossession regime at the time had been legally upheld". "The findings offer empirical support to the economic theory of mortgage default and to moral-hazard costs of impediments to repossession," according to the research. The researcher added: "The views in this paper are my own and do not constitute the views of the Central Bank." But the head of policy at the Free Legal Advice Centres (Flac) questioned the focus of the research, saying the Central Bank should "have better things to do" amid the arrears crisis than promoting the idea of moral hazard, says the Irish Examiner. Paul Joyce said the research was not addressing "the real issue" of 31,000 mortgage accounts in long-term arrears, 10 years from the onset of the crash. In the past, Irish bank chiefs had talked of moral hazard and had argued that the reluctance of Irish courts to sanction property repossessions was hindering the lenders from dealing with the arrears crisis.

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NEW YORK TIMES REPORTS 49% SURGE IN ONLINE SUBSCRIBERS - New York Times shares rose to their highest level in more than a decade, as the newspaper reported a surge in digital subscribers and revenues at the end of last year.

The company signed up 157,000 paying online readers in the fourth quarter, a 49% increase over the previous year, which included the US election and the so-called "Trump bump", a boom in readership among some of the US president’s favourite media targets. The New York Times now has more than 2.6 million digital subscribers, while overall subscription revenue has passed $1 billion for the first time in 2017 and now accounts for 60% of the company’s sales, writes the Financial Times. Shares jumped more than 14% to $25.33 in afternoon trading in New York, their highest level since 2007. At a time when publishers are juggling the decline of the traditional print business and difficulties competing with Google and Facebook for digital advertising budgets, the newspaper has shifted its commercial strategy from relying on marketers to paying readers. "We still regard advertising as an important revenue stream, but believe that our focus on establishing close and enduring relationships with paying, deeply engaged users . . . is the best way of building a successful and sustainable news business," said Mark Thompson, chief executive of the Times.

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